Illinois Official Reports 

Appellate Court

Advanced Physicians, S.C. v. Provena Glenwood Medical Imaging,

2018 IL App (3d) 170296

Appellate Court 

Caption

ADVANCED PHYSICIANS, S.C., Plaintiff-Appellee, v. PROVENA 

GLENWOOD MEDICAL IMAGING, and FUTURE 

DIAGNOSTICS GROUP, LLC, Defendants-Appellants.

District & No. Third District 

Docket No. 3-17-0296

Filed July 5, 2018

Decision Under 

Review

Appeal from the Circuit Court of Will County, Nos. 09-CH-5679, 

10-CH-2054, 10-CH-3108; the Hon. Raymond E. Rossi, Judge, 

presiding.

Judgment Certified questions answered.

Counsel on

Appeal

David J. Tecson and Daniel J. Fumagalli, of Chuhak & Tecson, P.C., 

of Chicago, for appellant Provena Glenwood Medical Imaging.

Epaminondas Eddie Manelis, of Chicago, for appellant Future 

Diagnostics Group (FDG), LLC.

Hall Adams III, of Law Offices of Hall Adams, LLC, of Chicago, and 

Jeffery J. Tomczak, of Tomczak Law Group, of Joliet, for appellee.
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Panel JUSTICE McDADE delivered the judgment of the court, with 

opinion.

Justice Schmidt concurred in the judgment and opinion. 

Justice Wright dissented, with opinion. 

 OPINION 

¶ 1 The plaintiff, Advanced Physicians, S.C. (Advanced Physicians), sought to maintain a 

qui tam action against the defendants, Provena Glenwood Medical Imaging (Provena) and 

Future Diagnostics Group, LLC (FDG). After extensive motion practice, the circuit court 

denied the defendants’ motions, culminating in an interlocutory appeal under Illinois Supreme 

Court Rule 308 (eff. Jan. 1, 2015). Four certified questions are presented in this appeal, 

including a question regarding whether the circuit court had subject matter jurisdiction and a 

question regarding whether Advanced Physicians constitutes an “interested” person for 

purposes of being able to maintain the qui tam action. We answer the first and second 

questions in the negative. 

¶ 2 FACTS 

¶ 3 On February 7, 2006, John Donaldson filed a qui tam action under seal in the Cook County 

circuit court, alleging that certain magnetic resonance imaging (MRI) facilities engaged in a 

fraudulent kickback scheme regarding MRI services. The complaint alleged that the MRI 

facilities entered into lease agreements with physicians who would refer their patients to the 

MRI facilities for MRI services but then, despite not providing any services for their patients, 

the physicians would bill the insurance companies at excessive rates for the MRI services and 

then split the proceeds with the MRI facilities. Count I of the complaint alleged a violation of 

the Insurance Claims Fraud Prevention Act (Act) (740 ILCS 92/1 et seq. (West 2006)). Count 

II alleged violations of the Consumer Fraud and Deceptive Business Practices Act (815 ILCS 

505/1 et seq. (West 2006)). 

¶ 4 On January 17, 2007, the Cook County circuit court unsealed the contents of the court file 

in Donaldson’s qui tam action. Also on that date, the Attorney General’s office issued a press 

release stating that it had decided to join the case. News of the lawsuit received media coverage 

in the Chicago area. Two years later, on January 14, 2009, the Attorney General announced 

that it had settled the case for $1.2 million. Attorney General Madigan Settles MRI Kickback 

Case for $1.2 Million, Ill. Att’y Gen. (Jan. 14, 2009), http://www.illinoisattorneygeneral.gov/

pressroom/2009_01/20090114.html. 

¶ 5 On May 22, 2007, chiropractors and siblings Dana and Richard Vallandigham filed a civil 

complaint in the Cook County circuit court against numerous MRI facilities, including 

defendants Provena and FDG, based on the alleged kickback scheme and claiming that the 

MRI-service business that they wholly owned, Advanced Physicians, S.C., was harmed by the 

scheme. Count I alleged violations of the Illinois Antitrust Act (740 ILCS 10/1 et seq. (West 

2006)). Count II alleged civil conspiracy. Count III alleged violations of the Consumer Fraud 

and Deceptive Business Practices Act. Count IV was a qui tam claim alleging violations of the 

Act. All of these counts were based on allegations that the MRI facilities conspired to 
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monopolize the MRI-service market in the Chicago area. In part, the complaint alleged that 

when the Vallandighams began marketing their MRI services to local physicians in 2005, 

some of these physicians stated that they had contractual relationships with the MRI providers 

and would not send their MRI business to the open market. The Vallandighams also alleged 

that they were told details about these “sham” lease agreements, in which “the referring 

physicians and clinics *** would pay or reimburse a flat fee of around $450.00 for an MRI 

scan while the referring physicians and clinics were billing the patient or their third party payor 

for these services at a much higher rate.” This was allegedly done to “make it appear that the 

Referrers were leasing space at the Defendant MRI Facilities when, in fact, the physicians did 

not attend to their patients’ MRI scans or perform any services at the MRI facilities.”

¶ 6 On October 17, 2008, the Attorney General, who had decided to intervene in the qui tam

claim, filed a motion to dismiss the Vallandighams as interested persons with prejudice and to 

voluntarily dismiss count IV of the 2007 Vallandigham complaint. The motion stated that the 

Vallandighams were not contesting their dismissal from count IV of the complaint, but that 

they intended to proceed with the first three counts. Further, the motion alleged: 

“8. The State was independently investigating this matter before the 

Vallandighams filed their complaint, and will continue to investigate as the State 

deems appropriate. 

 9. In addition, the State’s broad, state-wide investigation of schemes complained of 

by the Vallandighams was previously disclosed through prior litigation, news media, 

and an Attorney General press release. 

 10. The Vallandighams do not qualify as original sources because they have not 

provided any direct and independent knowledge of the information on which the 

allegations are based. The Vallandighams have not demonstrated that they had 

firsthand knowledge of the alleged fraud and that they obtained this knowledge through 

their own labor unmediated by anything else.”

¶ 7 On October 27, 2008, the Cook County circuit court entered an order granting the Attorney 

General’s motion to dismiss. The court specifically found that (1) “[t]he allegations in this 

complaint were previously publicly disclosed through previously filed litigation, media 

reports, and an Attorney General press release” and (2) “[t]he Vallandighams are not original 

sources of the information on which this action is based, within the meaning of Section 30(b) 

of [the Act (740 ILCS 92/30(b) (West 2006))].” The court’s order (1) dismissed the 

Vallandighams as interested persons with prejudice, (2) granted the voluntary dismissal of 

count IV of the 2007 complaint without prejudice and allowed the State to refile as it saw fit, 

and (3) permitted the 2007 Vallandigham complaint to proceed on counts I-III because the 

State was not a party to those counts. 

¶ 8 On July 17, 2009, the Vallandighams filed another complaint in the Cook County circuit 

court against Provena that contained essentially the same allegations as counts I-III of the 2007 

complaint, i.e., violations of the Antitrust Act, civil conspiracy, and violations of the Consumer 

Fraud and Deceptive Business Practices Act and the Medical Practice Act of 1987 (225 ILCS 

60/1 (West 2006)). The parties agreed to transfer the case to Will County. 

¶ 9 On March 22, 2010, the Vallandighams filed their first amended complaint, which 

included counts I-III from the 2009 complaint, but also reintroduced the same qui tam claim 

that was included in the 2007 complaint—i.e., count IV, from which the Vallandighams had 
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been dismissed with prejudice and that had been voluntarily dismissed by the Attorney 

General. 

¶ 10 Provena filed a motion to dismiss the 2010 first amended complaint. Regarding counts 

I-III, the circuit court granted the motion to dismiss without prejudice. The court denied the 

motion regarding count IV. 

¶ 11 On July 15, 2010, a second amended complaint was filed with the Will County circuit 

court. However, the complaint was filed by Advanced Physicians—the business wholly owned 

by the Vallandighams—rather than by the Vallandighams themselves. The second amended 

complaint included the same four counts that appeared in the 2010 first amended complaint. 

¶ 12 Provena filed a motion to dismiss the 2010 second amended complaint. The circuit court 

consolidated the case (Will County circuit court case number 09-CH-5679) with another action 

the Vallandighams had filed against defendant FDG (Will County circuit court case number 

10-CH-2054). The court then denied Provena’s motion to dismiss and a motion to dismiss that 

had been filed by FDG. 

¶ 13 Subsequently, Advanced Physicians filed a third amended complaint on May 5, 2011, 

which added over 80 physicians and physician groups as defendants. Later, Advanced 

Physicians voluntarily dismissed counts I-III of its third amended complaint, but it proceeded 

on count IV. 

¶ 14 There is nothing in the record to indicate that the Vallandighams complied with the various 

requirements of the Act at the time that they realleged count IV.1

 The only indication that the 

Attorney General was ever contacted about the claim is that Advanced Physicians asserts that 

it “provided a comprehensive report on the status” of its claim to the Attorney General on 

August 11, 2014—five years after the complaint in which it was substituted as plaintiff was 

filed. This “comprehensive report” consisted of a letter from counsel for Advanced Physicians 

to the Attorney General’s office. The purpose of the lengthy letter can be seen in its second 

paragraph: 

“The fundamental issue before the Court is whether Advanced Physicians can proceed 

with its [Insurance Claims Fraud Prevention Act] claim in Will County when, upon 

motion of the Illinois Attorney General’s office, a similar claim was dismissed in Cook 

County in 2009. For the reasons set forth below, we believe it can, particularly if the 

Illinois Attorney General agrees that Advanced Physicians is the ‘original source’ of 

the alleged scheme as to these specific defendants—a position that, admittedly, would 

be contrary to that taken by the Attorney General in 2009, but which we believe is fully 

supported by the facts.”

¶ 15 Motions to dismiss and for summary judgment were filed regarding the third amended 

complaint. In part, Provena had argued that the Attorney General’s dismissal of the 

Vallandigham qui tam action deprived the court of subject matter jurisdiction over the 

Advanced Physicians action—because Advanced Physicians was wholly owned and operated 

by the Vallandighams, it was likewise not an original source of the information provided to the 

Attorney General. Those motions were denied. 

 

1

See, e.g., 740 ILCS 92/15(b) (West 2010) (requiring, in part, that “[a] copy of the complaint and a 

written disclosure of substantially all material evidence and information the person possesses shall be 

served on the State’s Attorney and Attorney General”).
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¶ 16 In April 2017, the circuit court allowed Provena’s motion to file an interlocutory appeal 

and certified the following four questions: 

(1) “The legal issue of whether the Illinois Attorney General’s Motion to Dismiss 

the Vallandighams as interested persons with prejudice dated October 17, 2008, 

combined with the Order which granted the Motion, deprived all subsequent courts of 

subject matter jurisdiction pursuant to [the Act].”

(2) “The legal issue of whether Advanced Physicians, S.C. satisfies the definition 

of an interested person as defined by Section 15 of the [Act] given that Richard and 

Dana Vallandigham were the qui tam plaintiffs who filed the action and served a copy 

of the complaint on the State’s Attorney and Attorney General.”

(3) “The legal issue of whether a discount provided by PGMI pursuant to an MRI 

lease with a physician constitutes ‘remuneration’ as defined by Section 5 of the [Act].”

(4) “The legal issue of whether the plaintiff must establish fair market value for the 

medical service in question in the event Illinois courts find that a discount may satisfy 

the definition of ‘remuneration’ as defined by the [Act].”

We also note that the only defendants that appealed were Provena and FDG. 

¶ 17 ANALYSIS 

¶ 18 The first question certified for this appeal is “[t]he legal issue of whether the Illinois 

Attorney General’s Motion to Dismiss the Vallandighams as interested persons with prejudice 

dated October 17, 2008, combined with the Order which granted the Motion, deprived all 

subsequent courts of subject matter jurisdiction pursuant to [the Act].”

¶ 19 Subject matter jurisdiction “refers to the power of a court to hear and determine cases of the 

general class to which the proceeding in question belongs.” Belleville Toyota, Inc. v. Toyota 

Motor Sales, U.S.A., Inc., 199 Ill. 2d 325, 334 (2002). “With the exception of the circuit court’s 

power to review administrative action, which is conferred by statute, a circuit court’s subject 

matter jurisdiction is conferred entirely by our state constitution.” Id. 

¶ 20 A circuit court’s subject matter jurisdiction extends to all “justiciable matters.” Ill. Const. 

1970, art. VI, § 9. “Thus, in order to invoke the subject matter jurisdiction of the circuit court, 

a plaintiff’s case, as framed by the complaint or petition, must present a justiciable matter.” 

Belleville Toyota, 199 Ill. 2d at 334. 

¶ 21 “Generally, a ‘justiciable matter’ is a controversy appropriate for review by the court, in 

that it is definite and concrete, as opposed to hypothetical or moot, touching upon the legal 

relations of parties having adverse legal interests.” Id. at 335. Notably, the legislature can 

create a justiciable matter “by enacting legislation that creates rights and duties that have no 

counterpart at common law or in equity.” Id. It is important to note, however, that when the 

legislature creates a new justiciable matter, the legislature does not confer subject matter 

jurisdiction on the circuit court. Id. Thus, what may appear in the enacted legislation to be 

conditions precedent to the circuit court’s exercise of subject matter jurisdiction are in fact not

jurisdictional prerequisites. See In re M.W., 232 Ill. 2d 408, 425-26 (2009); see also Belleville 

Toyota, 199 Ill. 2d at 340. For example, a four-year statute of limitations for bringing certain 

actions under the Motor Vehicle Franchise Act (815 ILCS 710/1 et seq. (West 2000)) did not 

constitute a jurisdictional prerequisite; rather, it provided “an affirmative defense that the 
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defendant might plead as a bar to liability.” M.W., 232 Ill. 2d at 425 (citing Belleville Toyota, 

199 Ill. 2d at 344-45). 

¶ 22 The Act is a whistleblower law that provides “interested” persons, including insurers, with 

the ability to bring civil actions on behalf of the State for insurance fraud, including kickback 

schemes. See 740 ILCS 92/5(a), 15(a) (West 2006). Actions brought by an “interested” person 

under the Act are qui tam actions.2See Black’s Law Dictionary 1251 (6th ed. 1990) (defining 

a qui tam action as “an action brought by an informer, under a statute which establishes a 

penalty for the commission or omission of a certain act, and provides that the same shall be 

recoverable in a civil action, part of the penalty to go to any person who will bring such action 

and the remainder to the state or some other institution”). The State is the real party in interest 

in qui tam actions. See 740 ILCS 92/20 (West 2014); Scachitti v. UBS Financial Services, 215 

Ill. 2d 484, 515 (2005); State ex rel. Saporta v. Mortgage Electronic Registration Systems, 

Inc., 2016 IL App (3d) 150336, ¶ 18. “[Q]ui tam plaintiffs, acting as statutorily designated 

agents for the state, may proceed only with the consent of the Attorney General, and remain 

completely subordinate to the Attorney General at all times.” Scachitti, 215 Ill. 2d at 515; see 

also 740 ILCS 92/15 (West 2014). 

¶ 23 The limitations written into section 15 of the Act, such as the “interested” persons 

requirement, are not jurisdictional prerequisites and therefore do not impact the circuit court’s 

subject matter jurisdiction. See Belleville Toyota, 199 Ill. 2d at 340; M.W., 232 Ill. 2d at 425. 

Thus, the circuit court in this case has subject matter jurisdiction to hear qui tam claims 

brought under the Act such as count IV of Advanced Physicians’ amended complaint. The 

2008 Cook County circuit court finding that the Vallandighams were not “interested” persons 

under the Act in no way impacts the Will County circuit court’s subject matter jurisdiction in 

this case. Accordingly, we answer the first certified question in the negative. 

¶ 24 The second question certified for this appeal is “[t]he legal issue of whether Advanced 

Physicians, S.C. satisfies the definition of an interested person as defined by Section 15 of the 

[Act] given that Richard and Dana Vallandigham were the qui tam plaintiffs who filed the 

action and served a copy of the complaint on the State’s Attorney and Attorney General.”

¶ 25 In essence, this is a question of res judicata, which means that “a final judgment on the 

merits rendered by a court of competent jurisdiction bars any subsequent actions between the 

same parties or their privies on the same cause of action.” Rein v. David A. Noyes & Co., 172 

Ill. 2d 325, 334 (1996). The res judicata bar “extends not only to what was actually decided in 

the original action, but also to matters which could have been decided in that suit.” Id. at 

334-35. 

¶ 26 The three elements of res judicata are “(1) a final judgment on the merits has been 

rendered by a court of competent jurisdiction; (2) an identity of cause of action exists; and (3) 

the parties or their privies are identical in both actions.” Hudson v. City of Chicago, 228 Ill. 2d 

462, 467 (2008). 

¶ 27 There is no question that the first two elements of res judicata have been met. An order 

allowing a voluntary dismissal constitutes a final judgment. See Kahle v. John Deere Co., 104 

Ill. 2d 302, 305-07 (1984). In addition, the dismissal with prejudice of a party from a claim is a 

final and appealable order if it either also disposes of all remaining claims and parties or 

 

2

For a history of the development of qui tam actions, see Vermont Agency of Natural Resources v. 

United States ex rel. Stevens, 529 U.S. 765, 774-78 (2000).
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includes an appropriate finding by the circuit court under Illinois Supreme Court Rule 304(a) 

(eff. Jan. 1, 2006). State ex rel. Beeler, Schad & Diamond, P.C. v. Target Corp., 367 Ill. App. 

3d 860, 864 (2006). Furthermore, it is undisputed that the claim brought in count IV by 

Advanced Physicians is the same claim brought by the Vallandighams in 2007. 

¶ 28 Thus, the remaining question is whether the parties or their privies are identical. Regarding 

the defendants, the only two that appealed were Provena and FDG.3

 Both of these defendants 

were named in the Vallandighams’ 2007 complaint. Therefore, the only question is whether 

the plaintiffs are the same. 

¶ 29 For res judicata purposes, courts have routinely found privity between officers of 

corporations and the corporations themselves. See, e.g., National Union Fire Insurance Co. of 

Pittsburgh, PA v. DiMucci, 2015 IL App (1st) 122725, ¶ 32; Marine Midland Bank v. Slyman, 

995 F.2d 362, 365 (2d Cir. 1993). We see no reason to reach a different conclusion in the 

present case. Even though the Attorney General did not allege in its motion to dismiss the 

Vallandighams from the 2007 case that they were not “interested” persons, the Cook County 

circuit court nevertheless found that they in fact were not “interested” persons for purposes of 

the Act and dismissed them with prejudice. The Vallandighams did not challenge that finding. 

Subsequently, although the record is not entirely clear on how or why it came about, the 

Vallandighams decided to reraise the claim pursuant to the Act against Provena and FDG in 

Will County, despite the fact that this was the exact claim they brought in Cook County in 

2007—which the Attorney General voluntarily dismissed after the Vallandighams were 

dismissed with prejudice as parties. Then, and again the record is not entirely clear on how it 

happened, the Vallandighams suddenly disappeared as the named plaintiffs and were 

substituted by their wholly owned corporation, Advanced Physicians. For res judicata

purposes, there is no difference between the Vallandighams and Advanced Physicians. We 

further note that arriving at this conclusion does not require a factual finding regarding the 

corporate structure of Advanced Physicians, as the dissent alleges. There is no dispute that the 

Vallandighams wholly own Advanced Physicians; they pled as much throughout the 

proceedings below. 

¶ 30 Because the Vallandighams were found not to constitute “interested” persons under the 

Act, the same conclusion must be drawn regarding Advanced Physicians in this case. 

Accordingly, we answer the second certified question in the negative. 

¶ 31 Our rulings on the first two certified questions obviate the need to address and answer the 

third and fourth certified questions. 

¶ 32 CONCLUSION 

¶ 33 We answer the first and second questions certified by the circuit court of Will County in the 

negative; our answer to the second question obviates the need to address the remaining two 

certified questions. 

¶ 34 Certified questions answered. 

 

3There is no indication from the record what occurred regarding the additional defendants named in 

Advanced Physicians’ third amended complaint. 
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¶ 35 JUSTICE WRIGHT, dissenting: 

¶ 36 In Rozsavolgyi v. City of Aurora, 2017 IL 121048, our supreme court provides very 

instructive guidance concerning interlocutory appeals. I note that Rozsavolgyi was issued by 

our supreme court after we allowed the interlocutory appeal in this case. 

¶ 37 However, in this recent decision, our supreme court carefully reminds litigants and 

reviewing courts that Rule 308 interlocutory appeals are not favored. Rozsavolgyi, 2017 IL 

121048, ¶ 22. I believe this language is worth repeating. Rule 308 appeals are not favored. I 

welcome this clarification from our supreme court that permits our court to reexamine a 

decision to allow an interlocutory appeal. Upon reconsideration in this case, I would vacate our 

order allowing the interlocutory appeal on two grounds. First, I conclude that the trial court’s 

decision was correct. Second, after digesting Rozsavolgyi, I would exercise the option to 

reconsider my decision to allow the Rule 308 petition. 

¶ 38 My separate offering is not intended to be critical of this panel’s decision to allow the Rule 

308 petition on August 4, 2017. I also recognize that my respected colleagues do not share my 

view that our decision to allow the Rule 308 petition should be reconsidered in the first place. 

¶ 39 Upon reconsideration, I would vacate our order allowing leave to appeal on the first 

certified question for the reasons set forth below. A permissive interlocutory appeal under Rule 

308 should not take place unless it involves a question of law. However, not all questions of 

law meet the requirements necessary for a Rule 308 appeal. This question of law must involve 

an issue where there is a substantial ground for a difference of opinion and an immediate ruling 

will materially advance the ultimate termination of the litigation. See Ill. S. Ct. R. 308 (eff. Jan. 

1, 2015). Each certified question now before this court has been labeled as a request for 

guidance on a “legal issue.” Nonetheless, calling the issue in each question a “legal issue” does 

not make it so. 

¶ 40 Now, in hindsight, I do not believe the first certified question meets the Rule 308 

requirement that there was a substantial difference of opinion on the scope of the trial court’s 

statutory subject matter jurisdiction. There is little debate that the trial court had subject matter 

jurisdiction in this matter. As the majority notes above, “The limitations written into section 15 

of the Act, such as the ‘interested’ persons requirement, are not jurisdictional prerequisites and 

therefore do not impact the circuit court’s subject matter jurisdiction. See Belleville Toyota, 

199 Ill. 2d at 340; M.W., 232 Ill. 2d at 425.” Supra ¶ 23. If the first certified question may be 

answered by the majority with a reference to existing and longstanding appellate case law, I 

respectfully observe that the first certified question does not involve an issue for which there 

are substantial grounds for a difference of opinion. See Rozsavolgyi, 2017 IL 121048, ¶ 32. 

¶ 41 The second certified question involves questions of fact regarding whether this corporation 

and the officers of this corporation are the same person. Privity cannot be determined without 

considering the facts pertaining to the structure of Advanced Physicians when the entity was 

granted corporate status. If the answer to the second certified question depends on the 

underlying facts, the second certified question is improper for consideration under Rule 308. 

Rozsavolgyi, 2017 IL 121048, ¶ 21 (citing In re Estate of Luccio, 2012 IL App (1st) 121153, 

¶ 32). 

¶ 42 Similarly, the third certified question requires our court to determine whether Provena’s 

discount constitutes remuneration as defined by section 5 of the Act. The answer to the third 

certified question cannot be reached without reviewing the MRI lease to determine the 

structure of the discount. Again, our supreme court has instructed our court to act as a 
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“gatekeeper” by closely guarding against improper interlocutory appeals. Rozsavolgyi, 2017 

IL 121048, ¶ 23. 

¶ 43 Finally, the fourth certified question seeks guidance on the burden of proof to establish fair 

market value. The language of the fourth question indicates the answer to this certified 

question is necessary “in the event Illinois courts find that a discount may satisfy the definition 

of ‘remuneration’ as defined by the [Act].” (Emphasis added.) Consequently, I conclude that 

we would not materially advance the ultimate termination of the litigation because the question 

involves a contingency that may not take place. 

¶ 44 Based on guidance from the decision in Rozsavolgyi, I would vacate our order granting 

leave to appeal on all four certified questions and remand the matter to the trial court. As stated 

above, I would affirm the trial court’s decision.